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Digital vs electronic signatures?

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Source: Scrive

What is a digital signature?

A digital signature is a method for ensuring the integrity of digital documents. It’s like a fingerprint that is unique to that document. As with our own human fingerprints, it’s impossible for any other document to have that same digital signature.

 

What is an electronic signature?

An electronic signature is a method for entering into a legal agreement in a digital environment. Think of it as the digital equivalent of signing your name on a paper document, such as a sales contract. A person signing an agreement creates an electronic signature when they sign an electronic document by clicking a button or drawing their signature with a mouse, touchpad or other input device.

An electronic signature is defined as “data in electronic form which is attached to or logically associated with other data in electronic form and which is used by the signatory to sign”.

In US federal regulation, an electronic signature is defined as: “an electronic sound, symbol, or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.”

Types of electronic signatures

  • clicking a button to agree to on-screen text, such as terms and conditions
  • clicking and/or drawing your signature to sign an electronic document
  • making a sound or video recording of a verbal acknowledgment
  • authenticating your identity using a means of electronic identification (eID)

Not all of these will qualify as an electronic signature, and which method to use depends on the situation. Because the legal effect of these methods can vary greatly, factors such as cost of implementation, ease of use (customer experience), legislation, company policies and assessed business risk usually determine which one to use in a given situation. 

Even in the category of electronic signature, there are different levels, and which level is appropriate for a given situation will depend on the same factors mentioned above. These levels are explained further in the Scrive Trust Center.

 

What makes an electronic signature legally binding?

To conform with global contract law, a signature, whether electronic or on paper, must fulfil three key requirements:

  • intent
  • identity
  • integrity

If someone challenges the validity of a signed document, you must be able to show evidence of: the signing party’s intent to enter into a binding agreement, the signing party’s identity and the document’s integrity, i.e., that it has not been altered.

This third requirement, document integrity, is why you need a digital signature.

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